Charcot-Marie-Tooth (CMT) disease is one of the most common inherited neuropathies. Recently, three CMT1-associated point mutations (I43N, T51P, and I52T) were discovered in the abundant peripheral myelin protein P2. These mutations trigger abnormal myelin structure, leading to reduced nerve conduction velocity, muscle weakness, and distal limb atrophy. P2 is a myelin-specific protein expressed by Schwann cells that binds to fatty acids and membranes, contributing to peripheral myelin lipid homeostasis. We studied the molecular basis of the P2 patient mutations. None of the CMT1-associated mutations alter the overall folding of P2 in the crystal state. P2 disease variants show increased aggregation tendency and remarkably reduced stability, T51P being most severe. In addition, P2 disease mutations affect protein dynamics. Both fatty acid binding by P2 and the kinetics of its membrane interactions are affected by the mutations. Experiments and simulations suggest opening of the β barrel in T51P, possibly representing a general mechanism in fatty acid-binding proteins. Our findings demonstrate that altered biophysical properties and functional dynamics of P2 may cause myelin defects in CMT1 patients. At the molecular level, a few malformed hydrogen bonds lead to structural instability and misregulation of conformational changes related to ligand exchange and membrane binding.